We lost a genius with Nash, but not his equilibrium

One of the fathers of game theory, died together with his wife in a car accident last weekend. John Forbes Nash, aged 86, had just came back from Oslo where he collected the prestigious Abel Prize from the Norwegian Academy of Science and Letters for his mathematical work. Interestingly, 21 years ago now he also came back from Scandinavia with another prize. On that occasion he was awarded the Nobel Prize in Economics for his pioneering mathematical work in the 1950s. The prize recognized his work on the concepts of equilibrium in game theory.

His analyses in cooperative and non-cooperative games, known as the Nash Equilibrium, provide solutions to situations in which two or more parties interact to make decisions. His work have played since an essential role in the development of many branches of science, such as politics, biology, philosophy, computer science and of course economics.

“A set of strategies, in which no player acting alone can change your strategy to achieve a better outcome for himself,” is the definition devised by Nash equilibrium and has great importance in a situation where it does not exist trust between the parties, whatever its nature.

Coinffeine’s protocol allows decentralized exchange of bitcoins and has been developed based on Nash’ work and game theory as there is no trust between the parties and there is not a trusted third party. To exchange bitcoins and fiat money in Coinffeine both counterparties are matched automatically, without knowing who your counterparty is. This could have big risks if not for beautiful minds like Nash who have made this possible.

With the death of Nash, the world lost a genius. But fortunately his legacy will remain and the applications it may have, will be immortal.